Montréal (Québec) – Quebecor Inc. (“Quebecor” or the “Corporation”) today reported its consolidated financial results for the third quarter of 2020. Quebecor consolidates the financial results of its wholly owned Quebecor Media Inc. (“Quebecor Media”) subsidiary.
Third quarter 2020 highlights
Revenues: $1.11 billion in the third quarter of 2020, up $38.3 million (3.6%) from the same period of 2019.
Adjusted EBITDA: $513.4 million, up $4.1 million (0.8%).
Net income attributable to shareholders: $140.9 million ($0.56 per basic share) in the third quarter of 2020, compared with $178.5 million ($0.70 per basic share) in the same period of 2019, a decrease of $37.6 million ($0.14 per basic share).
Adjusted income from continuing operating activities: $173.1 million ($0.69 per basic share) in the third quarter of 2020, compared with $173.8 million ($0.68 per basic share) in the same period of 2019, a decrease of $0.7 million (increase of $0.01 per basic share).
Cash flows from operations: $346.1 million, up $13.7 million (4.1%).
The Telecommunications segment grew its revenues by $61.2 million (7.0%) and its adjusted EBITDA by $15.9 million (3.4%) in the third quarter of 2020.
Videotron Ltd. (“Videotron”) significantly increased its revenues from customer equipment sales ($60.9 million or 87.5%), mobile telephony ($12.7 million or 8.2%) and Internet access ($6.2 million or 2.2%) in the third quarter of 2020.
Videotron’s total average billing per unit (“ABPU”) was $49.96 in the third quarter of 2020, compared with $50.49 in the same period of 2019, a $0.53 (‑1.0%) decrease. Mobile ABPU was $50.98 in the third quarter of 2020, compared with $53.28 in the same period of 2019, a $2.30 (‑4.3%) decrease due in part to a decrease in overage and roaming revenues due to the COVID‑19 health crisis and the popularity of bring your own device (“BYOD”) plans.
There was a net increase of 4,700 revenue‑generating units (“RGUs”) (0.1%) in the third quarter of 2020, including 47,700 connections (3.4%) to the mobile telephony service and 20,500 subscriptions (1.2%) to the cable Internet access service.
Although the health situation and economic environment created by the pandemic have been posing major challenges worldwide for months now and some of our business units continue to be affected, Quebecor grew its revenues and adjusted EBITDA in the third quarter of 2020. The quality of our mobile phone service and the technological upgrading of our wireline service offer contributed to customer growth. In addition, we maintained a very prudent management of costs and capital investments, generating a 4.1% increase in our cash flows from operations. Quebecor enjoys optimal financial flexibility with more than $1.8 billion in available liquidity and a consolidated net debt leverage ratio of 2.76x.
Connectivity and information needs have never been greater, and we have continued to play a leading role in this area by providing families and businesses across Québec with world‑class essential services. Having completed a series of major infrastructure investments, we were able to connect more than 30,000 new homes to high‑speed Internet in several regions of Québec and our services have also been deployed in Abitibi-Temiscamingue. Our wireline services now reach more than 90% of Québec’s population. To accelerate Internet deployment and upgrades in all regions of Québec, we must all redouble our efforts and Bell Canada must end its unfair practices. Bell Canada must act now by putting in place concrete, effective measures to allow timely access to its support structures, said Pierre Karl Péladeau.
The robustness and reliability of Videotron’s network have been clearly demonstrated in the past few months, said Jean‑François Pruneau, President and Chief Executive Officer of Videotron.
The network has successfully handled historic highs in traffic. Its excellent performance was recognized by a study released by the Canadian Radio‑television and Telecommunications Commission during the third quarter of 2020, which showed, among other things, that Videotron Internet service customers enjoy faster connections than their plan’s advertised speeds.
September 9, 2020 was the 10th anniversary of Videotron’s entry into the mobile telephony market. Over the past decade, Videotron's progress has been impressive with now more than 1,452,600 subscriber connections as of September 30, 2020, a net increase of 163,900 in the past 12 months. I am extremely proud of the distance we have travelled and our unbroken record of success. Our entry into mobile telephony has brought Quebecers more choice while creating jobs throughout Québec. And our progress has not ended there. We have continued and will continue to innovate, as evidenced by our Helix home entertainment and connected lifestyle platform, which is already a resounding success with more than 508,000 RGUs since its launch in August 2019, concluded Jean François Pruneau.
As expected, the pandemic continued to impact TVA Group Inc.’s (“TVA Group”) business and hence its third quarter 2020 financial results, noted France Lauzière, President and Chief Executive Officer of TVA Group.
The health crisis caused a significant decline in our advertising revenues and a large reduction in the number of sporting events broadcast by the TVA Sports specialty channel, despite the broadcast of the National Hockey League (“NHL”) playoffs in the third quarter of 2020.
“TVA Group grew its total market share by 3.2 points to 41.5% in the third quarter of 2020. The increase was driven by the specialty channels, which posted a 3.3‑point gain, led by the all‑news channel LCN, which continued its growth with a 2.0‑point gain to remain the most‑watched specialty channel in Québec with 7.1%. The TVA Sports specialty channel was also up 1.9 point because of the NHL playoffs.
In our film production and audiovisual services business, with the gradual resumption of film shoots during the quarter we are now able to offer our clients our full complement of services again. MELS Studios and Postproduction has also launched a new virtual production stage, which offers an innovative alternative to conventional shoots and facilitates compliance with physical distancing rules, Ms. Lauzière said.
The current situation is forcing us to stay agile and to adapt, while remaining focused on our priorities and the disciplined execution of our strategies. We have maintained our customer‑centric vision and we continue to offer best‑in‑class products and services, while supporting the employees who have made Quebecor number one in customer experience. Lastly, our solid financial position enables us to manage our business prudently, keeping our sights on the long term, and to continue to invest to create shareholder value, concluded Pierre Karl Péladeau.
For more details and to consult definitions of "adjusted EBITDA", "adjusted income from continuing operating activities", "cash flows from operations", "average billing per unit", "revenue-generating unit" and "consolidated net debt leverage ratio" please refer to the attached PDF file for the complete version of the press release.
Chief Financial Officer
Quebecor Inc. and Quebecor Media Inc.
Quebecor Inc. and Quebecor Media Inc.